Unit 4 - Social Interactions Flashcards
(30 cards)
What is a social dilemma?
A situation in which actions taken independently by individuals in pursuit of their own private objectives result in an outcome which is inferior to some other feasible outcome that could have occurred if people had acted together, rather than as individuals.
What is a free ride?
Benefiting from the contributions of others to some cooperative project without contributing oneself.
What is altruism?
The willingness to bear a cost in order to benefit somebody else.
What is game theory?
A branch of mathematics that studies strategic interactions, meaning situations in which each actor knows that the benefits they receive depend on the actions taken by all.
What is a strategic interaction?
A social interaction in which the participants are aware of the ways that their actions affect others (and the ways that the actions of others affect them).
What is a strategy?
An action (or a course of action) that a person may take when that person is aware of the mutual dependence of the results for herself and for others. The outcomes depend not only on that person’s actions, but also on the actions of others.
What is a game?
A model of strategic interaction that describes the players, the feasible strategies, the information that the players have, and their payoffs.
What is division of labour?
The specialization of producers to carry out different tasks in the production process.
What are players?
Who is interacting with whom
What are feasible strategies?
Which actions are open to the players
What is the information (game)?
What each player knows when making their decision
What is a payoff?
The benefit to each player associated with the joint actions of all the players.
What is the best response?
In game theory, the strategy that will give a player the highest payoff, given the strategies that the other players select.
What is a dominant strategy?
Action that yields the highest payoff for a player, no matter what the other players do.
What is the dominant strategy equilibrium?
An outcome of a game in which every player plays his or her dominant strategy.
What is reciprocity?
A preference to be kind or to help others who are kind and helpful, and to withhold help and kindness from people who are not helpful or kind.
What is the prisoners’ dilemma?
A game in which the payoffs in the dominant strategy equilibrium are lower for each player, and also lower in total, than if neither player played the dominant strategy.
What are social preferences?
Preferences that place a value on what happens to other people, even if it results in lower payoffs for the individual.
What is a zero sum game?
A game in which the payoff gains and losses of the individuals sum to zero, for all combinations of strategies they might pursue.
What is a public good?
A good for which use by one person does not reduce its availability to others.
What is a social norm?
An understanding that is common to most members of a society about what people should do in a given situation when their actions affect others.
What is a revealed preference?
A way of studying preferences by reverse engineering the motives of an individual (her preferences) from observations about her or his actions.
What is crowding out?
There are two quite distinct uses of the term.
One is the observed negative effect when economic incentives displace people’s ethical or other-regarding motivations. In studies of individual behaviour, incentives may have a crowding out effect on social preferences.
A second use of the term is to refer to the effect of an increase in government spending in reducing private spending, as would be expected for example in an economy working at full capacity utilization, or when a fiscal expansion is associated with a rise in the interest rate.
What is cooperation?
Participating in a common project that is intended to produce mutual benefits.
